Fluctuations in supply and demand in the energy industry have led to a decline of 100,000 jobs worldwide, with 12,000 jobs disappearing in the U.S. alone since September 2014, The Wall Street Journal
The layoffs have hit specialists and support workers, but most heavily impact hard-manual labor working on oil rigs. "The closer your job is to the actual oil well, the more in jeopardy you are of losing that job," Tim Cook of PathFinder Staffing in Houston told the Journal.
"Each time an oil rig gets shut down, all the jobs at the work site are gone," Cook said. "They disappear."
The number of working oil and gas rigs in the country is now at its lowest point in five years. Shale fracking, which helped drive the U.S. oil boom, has become less profitable, the Journal reported.
Nevertheless, unemployment in the shale industry is still lower than the national average, according to Bloomberg
The layoffs have hit various sectors of the oil business, from companies that drill to firms that manufacture the equipment. All in all, over 300,000 workers have been making their living in energy-related employment as of September of last year. But that number is dropping. Just last week, the Texas Workforce Commission, which handles unemployment benefits, learned of 400 layoffs in energy-related business, the Journal reported.
The petroleum industry has offered hardworking noncollege-educated men and women a chance for well-paid positions that require skills which can be learned on the job. For example, after three years in the field, 27 year-old Alberto Hernandez was earning $72,000 annually as a derrick hand before he lost his job in January.
"Everything was going good," Hernandez told the Journal. "I bought a Chevy Silverado with cash."
Workers like Hernandez might be able to land construction jobs, but for about half what an oil-field worker earns, the Journal reported.
Lower prices have created an oil glut. The surplus is the result of factors such as a still-sluggish economy and the decision by OPEC not to reduce supply. Another dynamic is that the U.S. has become the world's largest oil producer.
If the glut were to disappear and prices went up, Russia and Iran would benefit, according to The Economist
. Most of Russia's export revenues
come from energy. The same is true for Iran
Crude prices have in fact been incrementally rising
, according to the Journal. The cost of a barrel of oil
is now hovering close to $60, the Journal reported, compared to about $115 in June 2014.
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